Capitalism V Communism Central to the tensions between Russia (USSR) and USA were their vastly different political and economic systems. It is difficult to find countries which represent ‘pure’ communism or capitalism.

Communism V Capitalism Some features of the theory of Communism Developed from the ideas of Karl Marx One political party with leader elected by the party. Government owns all land, property, businesses All goods and services shared equally by the people. No private ownership of property Government controls the media Religion banned. Some features of the theory of Capitalism Minimum interference in the economy. Allows for a range of political parties Private ownership of land, industry and business People have the right to work and use their money as they wish. People responsible for managing their own lives. System based on supply of and demand for goods and services which set prices.

Even in Australia today governments are expected to play a major role in providing for the welfare of their citizens. But after WW2 the Soviet Union and her wartime allies saw each other in black and white terms. Communism was ‘good’ or ‘evil’ depending on which side of the fence you were on and the same went for those countries favouring capitalism. And so the world was divided and the superpowers both sought to bring the countries of the world into their fold (theatre of influence)

THE IRON CURTAIN The USSR believed the only way to protect itself was to create a ‘buffer’ zone between Russia and western Europe. To the Americans and her allies this was seen as an attempted communist takeover. The Soviets encouraged and helped the rise of communist governments in a number of Eastern European countries. Refer to cartoons Sir Winston Churchill commented “ an iron curtain has descended on the continent.

In an attempt to convince European countries from succumbing to communism the new American president, Truman introduced a foreign policy which continues to influence American relations with other countries today. >>>>the Truman Doctrine (way of doing things). The policy was one of containment. During the Cold War, no direct fighting took place between the Soviet Union and the USA. However there were a number of conflicts and wars which did erupt. One of these was the Vietnam War. The Domino Theory was…see handout